Group 1 - The core viewpoint of the article highlights a bullish trend in the coal sector of the Hong Kong stock market, driven by favorable macroeconomic conditions such as "loose monetary policy, low interest rates, and improved risk appetite" [1] - The report from Zhongtai Securities indicates that the coal industry is expected to enter a new upward cycle due to the "anti-involution" policy, which is anticipated to strengthen expectations for capacity reduction and promote high-quality development within the sector [1] - The report suggests that there is a time lag between policy expectations and their realization, indicating that sector rotation may occur imminently, and advises investors to focus on liquidity and risk appetite improvements rather than short-term earnings reports [1] Group 2 - The article lists several coal stocks that experienced gains, with notable increases including Strength Development up by 2.6%, China Qinfa and Yanzhou Coal Energy both up over 2%, and China Shenhua up by 1.5% [1] - The report emphasizes the importance of capturing investment opportunities arising from the dual catalysts of coal valuation recovery and performance elasticity, as the industry prepares for a new upward cycle [1]

第 1 頁 共 10 頁 v 1.1.1 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年8月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 首鋼福山資源集團有限公司 呈交日期: 2025年9月1日 I. 法定/註冊股本變動 不適用 FF301 第 3 頁 共 10 頁 v 1.1.1 第 2 頁 共 10 頁 v 1.1.1 FF301 III.已發行股份及/或庫存股份變動詳情 (A). 股份期權（根據發行人的股份期權計劃） 不適用 FF301 II. 已發行股份及/或庫存股份變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 00639 | 說明 | | | | | | | | | 已發行股份（不包括庫存股份）數目 | | 庫存股份數目 | | 已發行股份總數 | | | 上月底結存 | | | 5,091,065,770 | | 0 | | ...

Core Viewpoint - CICC has lowered coal price and cost assumptions, resulting in a 4% reduction in Shougang Resources' (00639) 2025/26E profit to HKD 8.92 billion and HKD 9.78 billion respectively [1] Group 1: Financial Performance - The company's 1H25 net profit attributable to shareholders decreased by 38% year-on-year to HKD 4.04 billion, which was better than CICC's expectations due to a smaller decline in profit driven by coal prices, as the cost reduction exceeded expectations [2] - 1H25 production of raw coking coal and premium coking coal increased by 17% and 19% year-on-year to 2.64 million tons and 1.54 million tons respectively, with 100% of raw coal being washed [2] - The average selling price of premium coking coal in 1H25 fell by 45% year-on-year to HKD 1,067 per ton, while the price of Shanxi main coking coal decreased by 36% to HKD 1,401 per ton [2] Group 2: Cost and Cash Flow - The unit production cost of raw coking coal improved significantly in 1H25, decreasing by 28% year-on-year to HKD 328 per ton, with cash costs down by 32% to HKD 241 per ton [3] - The net operating cash inflow in 1H25 was HKD 4.53 billion, a decrease of HKD 7.27 billion year-on-year, with available free funds amounting to HKD 94.75 billion as of the end of June [3] - The company plans to distribute an interim dividend of HKD 0.06, corresponding to a payout ratio of 76%, resulting in an interim dividend yield of approximately 2.2% based on the current share price [3] Group 3: Market Outlook - CICC maintains a cautiously optimistic view on the coking coal market for 2H25, noting a rebound in coking coal prices since July due to supply contraction in some regions, with prices rising from HKD 968 per ton in June to HKD 1,278 per ton by August 28 [4] - The average price of coking coal in 3Q25 was HKD 1,209 per ton, reflecting a 10% increase compared to 2Q25 [4] - Future price increases may depend on further supply reductions, as demand for coking coal is expected to contract due to weak steel demand and declining profits [4]

Core Viewpoint - The report from CICC indicates a downward adjustment in coal price and cost assumptions, leading to a 4% reduction in Shougang Resources' (00639) estimated profits for 2025/26 to HKD 8.92 billion and HKD 9.78 billion respectively. The current stock price corresponds to a P/E ratio of 15.8x/14.4x for 2025/26E, with an enhanced relative attractiveness of dividends due to changes in risk appetite. The target price remains unchanged at HKD 3.00, implying an 8% upside potential based on a P/E ratio of 17.1x/15.6x for 2025/26E [1]. Group 1 - The company's 1H25 performance exceeded expectations, with a net profit attributable to shareholders declining by 38% year-on-year to HKD 4.04 billion, which was better than anticipated due to a smaller decline in profits driven by coal prices, as cost reductions were greater than expected [2]. - Production recovery was noted, with 1H25 raw coking coal and premium coking coal output increasing by 17% and 19% year-on-year to 2.64 million tons and 1.54 million tons respectively. The premium coking coal sales rose by 16% year-on-year to 1.55 million tons, primarily due to the resumption of operations at the Xingwu coal mine [2][3]. - The average selling price of premium coking coal in 1H25 fell by 45% year-on-year to HKD 1,067 per ton, while the price of Shanxi main coking coal decreased by 36% to HKD 1,401 per ton. The decline in selling prices was attributed to changes in coal quality and the commencement of full-scale mining at the Xingwu coal mine [2]. Group 2 - Significant improvement in unit production costs was observed, with the unit production cost of raw coking coal decreasing by 28% year-on-year to HKD 328 per ton. Cash costs fell by 32% year-on-year to HKD 241 per ton, and cash costs excluding uncontrollable costs decreased by 31% year-on-year to HKD 185 per ton [3]. - The net operating cash inflow for 1H25 was HKD 4.53 billion, a year-on-year decrease of HKD 7.27 billion. As of the end of June, the company had available free funds of HKD 94.75 billion, which, after excluding the year-end dividend for 2024, amounted to HKD 84.06 billion [3]. - The company plans to distribute an interim dividend of HKD 0.06, corresponding to a payout ratio of 76%, resulting in an interim dividend yield of approximately 2.2% based on the current stock price [3]. Group 3 - In 3Q25, coking coal prices have rebounded, with the price of Liulin No. 9 coking coal rising from a low of HKD 968 per ton in June to HKD 1,278 per ton by August 28. The average price since 3Q25 has been HKD 1,209 per ton, reflecting a 10% increase compared to 2Q25 [4]. - The outlook for coking coal prices remains cautiously optimistic, dependent on whether domestic supply can contract further, amidst weak steel demand and declining profits, which may still lead to expectations of reduced coking coal demand [4].

Core Viewpoint - Shougang Fushan Resources reported a 38% year-on-year decline in attributable net profit to HK$404 million for 1H25, which was better than expected due to a milder decline in earnings driven by a larger-than-anticipated reduction in costs despite falling coal prices [1]. Production and Sales - Raw and clean coking coal output increased by 17% and 19% year-on-year to 2.64 million tons and 1.54 million tons, respectively, with 100% of raw coal being washed. Clean coking coal sales volume rose 16% year-on-year to 1.55 million tons, primarily due to a temporary production suspension at Xingwu Coal Mine in 1H24 [1][2]. Price Trends - The average selling price of clean coking coal fell 45% year-on-year to Rmb1,067 per ton in 1H25. This decline was steeper than the 36% and 39% year-on-year decreases in Shanxi main coking coal prices at Jingtang Port and Shanxi Liulin No.9 coking coal, respectively. The price drop was attributed to a shift in coal quality following the full mining of lower-group coal at Xingwu Coal Mine [2]. Cost Management - The unit production cost of raw coking coal decreased by 28% year-on-year to Rmb328 per ton in 1H25. Cash costs fell 32% year-on-year to Rmb241 per ton, while cash costs excluding uncontrollable expenses declined 31% year-on-year to Rmb185 per ton [3]. Cash Flow and Dividends - Net operating cash inflow decreased by Rmb727 million year-on-year to Rmb453 million in 1H25. As of the end of June, the company held available free funds of HK$9.48 billion (HK$8.41 billion excluding the 2024 final dividend). The firm plans to pay an interim dividend of HK$0.06 per share for 1H25, resulting in a payout ratio of 76% and a dividend yield of approximately 2.2% based on the current share price [4]. Market Outlook - Coking coal prices rebounded in 3Q25, with a cautiously optimistic outlook for coking coal fundamentals in 2H25. Prices have risen since July, supported by tightening supply in certain regions. The price of Liulin No.9 coking coal increased from Rmb968 per ton in June to Rmb1,278 per ton by August 28, with a quarterly average of Rmb1,209 per ton in 3Q25, up 10% compared to 2Q25 [5]. Future Projections - The upside for coking coal prices will depend on domestic supply contractions, influenced by expectations of weaker demand amid sluggish steel consumption and declining profit margins. Coking coal imports, particularly from Mongolia, may see marginal improvement as coal prices recover [5]. Financial Adjustments - The company has lowered its coal price and cost assumptions, cutting its 2025 and 2026 earnings forecasts by 4% to HK$892 million and HK$978 million, respectively. The stock is currently trading at 15.8x and 14.4x 2025e and 2026e P/E ratios. The company maintains an OUTPERFORM rating with a target price of HK$3.00, implying 17.1x and 15.6x 2025e and 2026e P/E ratios and offering an 8% upside [5].

Core Viewpoint - The company's performance in 1H25 exceeded expectations despite a 38% year-on-year decline in net profit to HKD 404 million, primarily due to falling coal prices, but the decline was less than anticipated due to a greater reduction in costs [1] Production and Sales - In 1H25, the production of raw coking coal and premium coking coal increased by 17% and 19% year-on-year to 2.64 million tons and 1.54 million tons, respectively, with 100% of raw coal being washed [2] - The sales volume of premium coking coal rose by 16% year-on-year to 1.55 million tons, largely due to the resumption of production after the temporary shutdown of the Xingwu coal mine last year [2] Price and Cost Analysis - The average selling price of premium coking coal in 1H25 decreased by 45% year-on-year to RMB 1,067 per ton, while the price of Shanxi main coking coal fell by 36% to RMB 1,401 per ton [2] - The unit production cost of raw coking coal improved significantly, decreasing by 28% year-on-year to RMB 328 per ton, with cash costs down by 32% to RMB 241 per ton [2] Cash Flow and Dividends - The net operating cash inflow in 1H25 was HKD 453 million, a year-on-year decrease of 7.27 million [2] - As of the end of June, the company had available free funds of HKD 9.475 billion, which, after excluding the year-end dividend for 2024, amounts to HKD 8.406 billion [2] - The company plans to distribute an interim dividend of 6 HK cents, corresponding to a payout ratio of 76% and a dividend yield of approximately 2.2% based on the current share price [2] Market Trends - In 3Q25, coking coal prices have started to rebound, with the price of Liulin No. 9 coking coal rising from a low of RMB 968 per ton in June to RMB 1,278 per ton by August 28, with an average price of RMB 1,209 per ton in 3Q25, reflecting a 10% increase from 2Q25 [3] - Future price increases may depend on further reductions in domestic supply, as demand for coking coal is expected to contract due to weak steel demand and declining profits [3] Profit Forecast and Valuation - The company has revised down its coal price and cost assumptions, reducing its earnings forecast for 2025 and 2026 by 4% to HKD 892 million and HKD 978 million, respectively [3] - The current share price corresponds to a price-to-earnings ratio of 15.8x for 2025 and 14.4x for 2026, with a target price maintained at HKD 3.00, implying an 8% upside potential [3]

Core Viewpoint - The company reported a significant decline in revenue and net profit for the first half of 2025, primarily due to a sharp drop in the selling price of premium coking coal, despite an increase in coal production [1][2]. Financial Performance - The company achieved a revenue of 2.1 billion HKD in 1H25, a year-on-year decrease of 17%, mainly impacted by a 45% drop in the selling price of premium coking coal [1]. - The net profit attributable to shareholders was 404 million HKD, down 51.7% year-on-year, aligning with the performance warning issued on August 8 [1]. - The company declared a dividend of 0.06 HKD per share, down from 0.09 HKD in 1H24, with the payout ratio increasing to 76% from 53% year-on-year [1]. Production and Cost Management - The company reported a recovery in raw coking coal production, reaching 2.64 million tons (+17.3% year-on-year) and premium coking coal production at 1.54 million tons (+19.4% year-on-year) [2]. - The increase in production was attributed to a return to average production levels from 2021-2023, following a temporary suspension last year [2]. - The company improved its washing technology, achieving a premium coal washing yield of approximately 58.3%, up 1 percentage point from 1H24 [2]. - The production cost of raw coal was 328 RMB per ton, a decrease of 27.6% year-on-year, driven by lower resource taxes, reduced depreciation, and cost-cutting measures [3]. Outlook and Valuation - For the second half of 2025, while resource taxes are expected to rise with coking coal prices, the company anticipates maintaining cost control, projecting an 8.2% year-on-year decrease in production costs [3]. - The company maintains its net profit estimates for 2025-2027 at 1.05 billion, 1.19 billion, and 1.19 billion HKD, respectively, and continues to use a Dividend Discount Model (DDM) for valuation [3]. - The target price remains at 3.4 HKD, with a "buy" rating upheld due to stable dividend expectations and high payout ratios [3].

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of HKD 3.40 [2][8]. Core Views - The company reported a revenue of HKD 2.1 billion for 1H25, a year-on-year decrease of 17%, primarily due to a 45% drop in the selling price of coking coal, although a 17.3% increase in raw coal production partially offset this decline [5][6]. - The net profit attributable to the parent company for 1H25 was HKD 404 million, down 51.7% year-on-year, aligning with the performance warning issued earlier [5][6]. - The company declared a dividend of HKD 0.06 per share for 1H25, down from HKD 0.09 in 1H24, with a payout ratio of 76% for 1H25 compared to 53% in 1H24 [5][6]. - The company expects production levels to stabilize in 2H25, with a focus on improving washing technology to counteract quality declines [6][7]. - The company has successfully reduced production costs by 27.6% year-on-year to HKD 328 per ton in 1H25, contributing to maintaining a low-cost advantage [7][8]. Financial Projections - Revenue projections for the company are as follows: HKD 5,057 million for 2024, HKD 4,358 million for 2025E, and HKD 4,607 million for 2026E [5][8]. - The net profit attributable to the parent company is projected to be HKD 1,494 million for 2024, HKD 1,047 million for 2025E, and HKD 1,191 million for 2026E [5][8]. - The company maintains a stable dividend expectation with a projected payout ratio of 80% from 2025 to 2035 [8]. Valuation Metrics - The company’s current market capitalization is HKD 14,102 million, with a closing price of HKD 2.77 as of August 28 [2][5]. - The price-to-earnings (PE) ratio is projected to be 9.20 for 2024 and 13.13 for 2025E, while the price-to-book (PB) ratio is expected to be 0.83 for 2024 and 0.80 for 2025E [5][8]. - The expected dividend yield is 11.01% for 2024, decreasing to 6.09% for 2025E [5][8].

Core Viewpoint - Shougang Resources (00639.HK) reported a significant decline in its mid-year performance for 2025, with revenues dropping by 17% year-on-year, primarily due to a substantial decrease in the average selling price of premium coking coal [1] Financial Performance - The company's revenue for the first half of 2025 was HKD 2.101 billion, a decrease of 17% compared to the previous year [1] - Gross profit fell to HKD 642 million, down 55% year-on-year [1] - Profit attributable to shareholders was HKD 404 million, a decline of 52%, with basic earnings per share at HKD 0.0794 [1] - The company proposed an interim dividend of HKD 0.06 per ordinary share [1] Operational Highlights - The decrease in revenue was mainly attributed to a 45% year-on-year drop in the average selling price of premium coking coal, which offset a 16% increase in sales volume and the positive impact of newly established coal trading operations [1] - The group produced approximately 2.64 million tons of raw coking coal, an increase of 17% year-on-year, with premium coking coal production rising by 19% to about 1.54 million tons [1] - Premium coking coal sales volume increased by 16% year-on-year, although the sales growth was less than production due to inventory changes as of June 30, 2025 [1] - Premium coking coal sales accounted for 100% of the group's revenue, aligning with the company's long-term strategy focused on premium coking coal sales [1] - The company also ventured into coal trading, achieving a trading volume of approximately 570,000 tons, which contributed to diversifying the group's revenue sources [1]

Core Insights - Shougang Resources (00639) reported a mid-year performance for 2025 with revenue of approximately HKD 2.101 billion, a year-on-year decrease of 17% [1] - Gross profit fell to HKD 642 million, representing a significant decline of 55% compared to the previous year [1] - Profit attributable to shareholders was HKD 404 million, down 52% year-on-year, with basic earnings per share at HKD 0.0794 and an interim dividend of HKD 0.06 per ordinary share [1] Revenue Analysis - The decrease in revenue was primarily attributed to a substantial drop of 45% in the average selling price of premium coking coal, which offset a 16% increase in sales volume and the positive impact of expanding coal trading operations [1] Profitability Factors - The significant reduction in profit was mainly due to the 55% decline in gross profit, amounting to approximately HKD 791 million [1] - Additionally, the decrease in the proportion of fire transportation sales, along with effective cost measures, led to a reduction in sales and distribution expenses by approximately HKD 34 million year-on-year [1] - Foreign exchange gains increased by approximately HKD 31 million year-on-year, while the provision for withholding tax on dividends decreased by about HKD 26 million due to a decline in profits from a major subsidiary established in China [1]